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Integrate New Age Tech Tools To Provide Solutions
The next big leap for the industry would come in the form of integrating new age technological tools seamlessly to introduce solutions that go far beyond the current individual use cases
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For any major economy, industry or sector, one of the biggest influencers in recent years has been technology. The scenario for the general insurance sector is no different. As per estimates, global investments in insurtech increased dramatically from $131 million in 2011 to $2.6 billion in 2016, a growth of 1,900 per cent. This investment has driven innovation across the spectrum, be it product innovation, customer service or the core areas of risk management, underwriting etc.
Globally, thanks to technology, traditional non-life insurance offerings based on macro pooling, fixed duration covers are giving way to micro insurance solutions and covers for episodic/ short duration events. Covers such as hourly motor insurance on demand, insurance for home renters, covers for affinity groups are being introduced backed by the latest technological tools.
At the same time, customer service standards are shifting to new levels – 24x7 service through chatbots, integrated concierge and telehealth services are fast becoming main stream. Today, claims are being triggered automatically on the occurrence of events – claims due to flight delay. Insurers are thus embracing cutting edge technology to solve problems across the customer value chain.
Insurance companies in India, too, are taking advantage of the fact that young digital savvy Indians treat insurance like other financial products and services, seeking to transact and be serviced digitally. The online revolution in insurance has come a long way since 2005. Advances in analytics and machine learning capabilities are making it possible for insurers to granularly interpret consumer behaviour data, allowing them to provide personalized solutions that better meet the expectations of customers. Further, insurers are harnessing robotic process automation tools to service our customers better by reducing the time taken from quote generation to policy issuance. By utilising IoT devices in industrial corporations, insurers are mitigating risks and reducing machinery failure, preventing short circuits and more importantly, predicting large equipment failure in the workplace.
As we look ahead, we see the role of technology in the non-life insurance industry, shifting from simply offering innovative and customer friendly solutions to acting as a catalyst in the industry transformation process. For long, insurance has been a risk transfer mechanism – settling claims efficiently. However, insurers are now evolving themselves to help corporate and individual customers manage their risks better. We are already seeing examples of this in segments such as crop insurance wherein insurers are harnessing the potential of remote sensing devices to develop various indices using geo-spatial data that provide insights into crop acreage. This is enabling insurers to understand risks better and directly settle crop insurance claims. Similarly, telematics devices are letting us understand insured driving and vehicle usage patterns. The ability to capture and analyse data from different sensors and sources in real time can enable insurance providers to develop proactive prevention models. From driving alerts to equipment failure notices, they can design automated processes to more actively manage risk, in collaboration with the insured.
The next big leap for the industry would come in the form of integrating new age technological tools seamlessly to introduce solutions that go far beyond the current individual use cases. Advances in artificial intelligence will help in further understanding and segmenting risks and in reducing operational costs by providing end-to-end solutions to the customer. The insurance industry has taken rapid strides in recent times, aided by insuretech. The future is poised to be lot more exciting.
Disclaimer: The views expressed in the article above are those of the authors' and do not necessarily represent or reflect the views of this publishing house. Unless otherwise noted, the author is writing in his/her personal capacity. They are not intended and should not be thought to represent official ideas, attitudes, or policies of any agency or institution.